IRREVOCABLE TRUST AGREEMENT
THIS AGREEMENT made and entered into the _____ day of
**, 199**, by and between **, an adult resident of **, **
County, Mississippi (hereafter referred to as "Grantor") and **
(hereafter referred to as "Trustees").
W I T N E S S E T H:
That for the good and valuable considerations (receipt of
which is hereby acknowledged), and for the purpose of
establishing an Irrevocable Trust to provide property
hereinafter designated and for the other purposes hereinafter
set forth, the Grantor does hereby convey, transfer and deliver
to the Trustees the property as itemized and described in
Schedule "A" which is attached hereto. All of said property together with all subsequent additions
thereto is to be held and administered by said Trustees as a
trust, subject to the following uses, terms and conditions:
ARTICLE I.
The Trustees shall hold and administer the income and
principle of this Trust for the benefit of the Grantor's wife,
** and child, **, born **, and any other children of the Grantor
born after the execution of this Agreement (hereinafter
collectively referred to as the "children").
ARTICLE II.
The Trustees shall hold the trust property in accordance
with the following provisions: A. The Trustees shall distribute, at least annually, in
equal shares among the beneficiaries of the trust all or any
part of the net income of the trust for the comfort, support,
education, maintenance, health and welfare of the beneficiaries.
If, during the existence of this trust, any of the Grantor's
children shall die leaving children surviving, the net income of
the trust for such surviving children of such deceased child of
the Grantor shall be distributed to and among them, or paid for
their benefit, as the Trustees shall, in their sole discretion,
deem necessary or desirable for the comfort, support, education,
maintenance, health and welfare of those children.In addition to the authority and discretion granted above,
the Trustees shall determine the taxable income of the trust
and, the Trustees, in their sole discretion, may distribute at
any time prior to the expiration of sixty-five (65) days
following the end of each taxable year of the trust, all or any
portion of any taxable income so determined, to one or more
income beneficiaries of the trust, if such action appears
desirable in the light of the overall tax situation of the trust
and the beneficiaries. Any income of the trust not distributed
by the Trustees shall be added to principal and retained in the trust. B. In addition to the net income, if in the sole and
absolute discretion of the Trustees, circumstances have arisen
which make it desirable for the comfort, support, education,
maintenance, health and welfare of any beneficiary, the Trustees
shall distribute to, or for the benefit of, any such beneficiary
of the trust (or to the surviving children of a deceased
beneficiary) such amount or amounts of principal from the trust
as the Trustees determine proper. In the exercise of this
discretion, the Trustees shall consider the needs of the
beneficiaries and the income available to them from other sources. C. Provided there are adequate funds available, should a
beneficiary which is a child or grandchild of the Grantor, after
attaining the age of twenty-one (21) years, desire to purchase
or construct a residence for himself or herself, the Trustees
may, in their discretion, upon the written request of such
beneficiary, advance out of the trust a sum or sums not in
excess of twenty-five percent (25%) of the purchase price of an
adequate and comfortable residence for such beneficiary. The
Trustees shall not make any such advancement unless or until
they are convinced that the advancement will be used for that
purpose only. Any such sum advanced to a beneficiary shall be a
charge against that beneficiary's trust estate.Provided there are adequate funds available, the Trustees
are further authorized to distribute to a beneficiary who is a
child or grandchild of the Grantor a portion of the principal of
the trust for the purpose of establishing that beneficiary in a
business or profession, provided that beneficiary has attained
the age of twenty-one (21) years. Any such distribution shall be
requested by the beneficiary in writing, and shall be
accompanied by factual information necessary to permit the
Trustees to evaluate the feasibility of such investment. If the
Trustees shall determine the proposed investment to be a
feasible one, the Trustees shall distribute such portions of the
principal of the trust as the Trustees, in their sole
discretion, deem desirable, but any such sum advanced to a
beneficiary shall be a charge against that beneficiary's trust estate. D. If Grantor's wife ** is deceased when the Grantor's
oldest living child attains the age of twenty-five (25) years,
the Trustees shall divide this trust into as many equal shares
as there are beneficiaries then living and children of the
Grantor who are deceased with issue surviving, and each share
shall be a separate trust. Thereafter, the Trustees shall
distribute income and/or principal to the beneficiaries of each
trust in accordance with the standards and provisions set forth
in Paragraphs A, B and C above. Thereafter, as and when each
child of the Grantor attains the age of twenty-five (25) years,
the Trustees shall distribute to that child, free and clear of
any trust, one-half (1/2) of that beneficiary's trust estate.
Thereafter, when that beneficiary attains age thirty (30) the
Trustees shall distribute to him or to her the remainder of his
or her trust estate and that beneficiary's trust shall
terminate. Notwithstanding the foregoing provision, however, the
Trustees shall permit each child to elect, by written direction
to the Trustees, at the time all or any portion of his or her
trust is to be distributed to him or her, to have such property
remain in trust under the terms and provisions hereof for the
balance of his or her life or until such time as he or she shall
request that the trust principal, accumulated income, or income,
or any part thereof, be distributed to him or her outright. In
addition, any beneficiary may voluntarily convey other property
owned by him or her outright. In addition, any beneficiary may
voluntarily convey other property owned by him or her to his or
her trust, to be held and administered as a part of his or her
trust continued herein. In the event of the death of a child of
the Grantor during the period in which the trust is so continued
the Trustees shall make immediate distribution of his or her
trust assets to this or her estate.Upon distribution of the entire trust estate to the
beneficiary or beneficiaries thereof, each trust shall terminate. E. In the event of the death of any child of the Grantor
prior to the receipt by such child of his or her entire trust
estate, then the balance remaining in the trust of said deceased
child shall be retained in trust for the benefit of said
deceased child's then living children. One-half (1/2) of the
trust estate for the surviving children of the Grantor's
deceased child shall be distributed in equal shares to such
surviving children when the youngest attains the age of twenty-
five (25). Thereafter, when the youngest living child of a
deceased child of the Grantor attains age thirty (30), the
Trustees shall distribute the remainder of the trust for the
surviving children to and among said living children in equal
shares, and their trust shall then terminate. If at the time of
the death of any child of the Grantor, he or she shall leave no
issue surviving, that deceased child's trust estate shall be
paid over and added to the trust herein created for the other
children of the Grantor, and shall be administered and disposed
of in accordance with the terms and provisions thereof, or shall
be distributed outright to the other children of the Grantor, or
the children of any deceased child, who had previously reached
the age to have received a distribution of his, her or their
entire trust estate. F. In the event all of the persons named and classes
designated as beneficiaries of this Trust shall die prior to the
complete distribution of all trust assets, said assets shall be
distributed to **. In the event ** is not living, the assets
shall be distributed as follows:
G. If at any time, in following the directions of this
Trust Agreement, the Trustees is required to distribute all or
any part of the principal of the trust herein created outright
to a person who is then a minor, the Trustees shall be
authorized and directed to continue to hold the share of such
minor in trust for that minor's benefit until he or she attains
age twenty-one (21). Until such time the Trustees is authorized
and directed to expend such part of the income and/or principal
of the share belonging to such minor as the Trustees in his sole
discretion deems necessary to provide for the proper support,
maintenance and education of said minor. H. This Trust shall be designated and known as " THE **
TRUST."
ARTICLE III.
Neither the principal nor the income of this trust, nor any
part of same, shall be liable for the debts of any of the
beneficiaries hereof, nor shall the same be subject to seizure
by any creditors of said beneficiaries. The said beneficiaries
shall not have any power to sell, assign, transfer, encumber or
in any manner to anticipate or dispose of their interest in the
trust funds, or any part of same, or the income produced from
said funds, or any part of same. In making payments for beneficiaries as required herein,
and especially where such beneficiaries may be minors, or by
reason of illness or otherwise be incapable of transacting
business, the Trustees, in their sole discretion, can make such
payments either (a) directly to such beneficiary, (b) to the
legal or natural guardian of such beneficiary, (c) to any
relative or guardian of such beneficiary, or (d) by applying
such payments for the benefit of such beneficiary by paying his
or her expenses directly. In any event the Trustees shall
require such reports or take such steps which they deem
requisite to insure and enforce the due application of such
payments for the exclusive benefit of the said beneficiary.ARTICLE IV.
If, during any calendar year, including the calendar year
the trust is created, any transfers or additions are made to
this trust by any person, including any transfer made to the
trust upon its creation, each beneficiary shall have the
absolute right and power, at all times thereafter during that
calendar year to demand immediate distribution to himself or
herself from this trust of any amount (which the Trustees of the
trust in their discretion may satisfy, in whole or part, by
distribution of property of equivalent current fair market
value) equal to the lesser of: A. Five Thousand Dollars ($5,000.00), or
B. The total cumulative amount of all gifts, transfers or
additions made by the Grantor or any other person to this trust
during such current calendar year, determined in the same manner
as such amount would be determined for Federal gift tax
purposes, divided by the number of beneficiaries. All transfers
or additions made by the Grantor or any other person to the
trust which are not treated as a gift for Federal gift tax
purposes shall be excluded from consideration under this
Paragraph B just as though such transfers or additions had not
been made or received. Each beneficiary shall have the right and power to demand
distribution from the trust at any time during the calendar year
in which the power arose, but in no event will a beneficiary
have less than thirty (30) days from date of receipt of notice
of an addition. If such right or power is not exercised within
the calendar year or within thirty (30) days of receipt of
notice of an addition, whichever is later, it shall lapse, and
the beneficiary shall forever cease to have any further right or
power of demand with respect to transfers or additions made to
the trust during such calendar year. Such demand right and power
shall be exercisable only by written instrument executed by the
beneficiary. If any child of the Grantor is entitled to exercise
such right and power but is then under any legal disability of
any kind, the exercise shall be by his legal guardian or if
there is no guardian by his or her natural mother, acting solely
on the child's behalf in making such demand and receiving such
distribution for his or her sole benefit. Each and every time
any addition is received by any trust hereunder which would give
rise to such demand right, the Trustees, within seven (7)
calendar days from the date of receipt thereof, shall give
notice of such addition to the Beneficiaries, or if any
beneficiary is then under legal disability, to the guardian of
his or her estate or if there is no guardian of his or her
estate or if there is no guardian to his or her natural mother.
Upon receipt by the Trustees of any proper written instrument of
demand, such instrument shall be forthwith honored and satisfied
by the Trustees as provided above, and to this end the Trustees
shall, at all times while such a demand right is outstanding and
exercisable, retain sufficient transferable assets in this trust
to satisfy such right of demand. ARTICLE V.
In dividing the principal of the Trust into parts or shares
and in making distributions thereof, the Trustees are authorized
and empowered in their sole discretion to make division or
distribution partially in kind and partially in money and may
distribute partial or undivided interests in assets. In making
such division or distribution the Trustees are specifically
excused from any duty or impartiality with respect to the income
tax basis of the property and may select assets so allocated or
distributed without respect to the income tax basis thereof. For
such purposes the assets shall be valued on the day or days of
distribution or division, as the case may be. The judgment of
the Trustees concerning values for the purpose of such division
or distribution of the property or securities shall be binding
and conclusive on all parties interested therein.ARTICLE VI.
Except as otherwise herein expressly provided, the
administration and management of the Trust herein created, the
sale and conveyance of the trust assets, the investment and
reinvestment of trust assets and the rights, powers, duties and
liabilities of the Trustees shall be in accordance with and
governed by the terms and provisions of the Uniform Trustees'
Powers Act of Mississippi as it now exists or may hereafter be
amended. However, in addition to the powers contained in that
Act the Trustees shall have full power and authority: A. To determine the allocation of receipts and expenses
between income and principal, provided such allocation is not
inconsistent with the beneficial enjoyment of trust property
accorded to a life tenant or remainderman under the general
principals of the laws of trusts, and, provided further, that
all rights to subscribe to new or additional stocks or
securities and all liquidating dividends shall be deemed to be principal. B. To permit available trust funds to remain temporarily
uninvested, or, in his discretion, to invest said funds in a
Savings Account or Certificates of Deposit in any bank or
savings and loan association. C. To receive and retain all types of property whether
received by conveyance made by the Grantor, or others, during
life, or by will, and especially to receive and retain in the
Trust shares of stock in closely held corporations and
unproductive real estate regardless of where it may be situated,
without liability and without regard to the proportion such
property or property of a similar character so held may bear to
the entire amount of the trust estate and whether or not such
property is of the class in which trustees generally are
authorized to invest by law. D. To sell, transfer, convey, mortgage, lease and dispose
of the trust property upon such terms and in such manner and for
such prices as the Trustees shall deem proper, and any lease or
other instrument which is executed by the Trustees shall
continue in full force and effect under its terms,
notwithstanding the termination of many trust hereunder. E. To make loans or advances upon such terms and conditions
as the Trustees, in their sole discretion, deem advisable;
provided, however, that no power given herein shall enable the
Trustees to sell, purchase, or otherwise deal with or dispose of
all or any part of the trust property for less than an adequate
consideration in money or money's worth, or to loan all or any
part of the principal or income of the tenants, directly or
indirectly, without adequate interest or security. F. To pay premiums on any insurance policies comprising a
part of the trust estate, and to take out, apply for, and buy
any type of insurance, including life, accident, health and
major medical insurance, on any beneficiary of the trust, and to
pay the premium thereon, out of either income or corpus. In
addition to the foregoing powers respecting insurance, the
Trustees shall have the right to do any and all things incident
to the purchase and ownership of such insurance. G. If at the death of the Grantor the Trustees herein named
shall be serving as Trustees of another trust created in the
Will of the Grantor, if the beneficiaries are the same and the
terms of that trust under the Grantor's Will are substantially
similar to the trust created herein, the Trustees shall be
authorized and empowered to consolidate such trusts and
administer the two as one, if such consolidation shall result in
more effective and efficient management of the two trusts. ARTICLE VII.
The following provisions shall apply with respect to any
and all life insurance policies, any proceeds of which may be payable to the Trustees hereunder:
A. The Trustees shall have the right to accept, take out,
apply for, purchase and/or pay the premiums on life insurance
policies on the life of **. Further, the Trustees shall have the right to pay premiums
on any insurance policies comprising a part of the trust estate,
and to take out, apply for, and buy any type of insurance for
the beneficiaries, including life, accident, health and major
medical insurance, and to pay the premiums thereon, out of
principal of the trust. However, in no event shall the Trustees
be obligated to pay any premiums unless funds for such payments
are available in the trust or conveyed to the Trustees by the
Grantor or others. Notwithstanding the foregoing, the Trustees
shall not use the income of the trust to pay premiums on life
insurance on the life of the Grantor, which premiums may only be
paid from principal. The Trustees shall not be under any
obligation to notify the Grantor, beneficiaries, or any other
person of the nonpayment of premiums. In addition to the
foregoing powers respecting insurance, the Trustees shall have
the right to do any and all things incident to the purchase and
ownership of such insurance. B. The Trustees may, in their discretion, cancel any of the
insurance policies held by them, no matter how acquired. The
policies may be cancelled and turned in for their cash surrender
value, if any, and the Trustees shall not be liable to any party
for cancelling the said policies. Furthermore, the Trustees may
borrow on, surrender, hypothecate or pledge the said policies,
convert them to different kinds of insurance or select any
method of settlement of the proceeds provided by the terms of
the policies. C. The Trustees may pay premiums by the "minimum deposit"
method (that is, borrow cash value) on all insurance that the
trust owns on the life of the Grantor or anyone else. The
Trustees shall use principal of the trust to pay the said
premiums. The Trustees may apply the dividends on such policies
to pay premiums. When making policy loans, the Trustees may
apply the dividends on such policies to pay premiums. When
making policy loans, the Trustees may elect the dividend type
option (that is, use dividends to purchase one year term
insurance) to keep the death benefit at the face amount of the
policy. The Trustees shall not be required to pay premiums from
their own funds.D. The Trustees, in their discretion, may borrow funds from
any party to pay the premiums on any policies of insurance owned
by the trust. As security for the repayment of the amounts
borrowed, the Trustees may collaterally assign the policy or
policies to the Lender and may, in their discretion, enter into
any agreement in regard to the collateral assignment of the policy. E. Upon the death of any insured, if insurance should be
payable to the trust, the Trustees shall receive such sums of
money as shall be payable to the trust under the terms of said
policies of life insurance, including accidental death benefits,
and they shall hold the same in trust for the uses and purposes
herein set forth. To facilitate the receipt of such sums of
money, the Trustees shall have the power to execute and deliver
receipts and such other instruments as they shall deem
advisable, to compromise or adjust disputed claims in such
manner as they in their sole and absolute discretion shall deem
advisable and proper for the collection of any such proceeds;
provided, however, that if payment on any such policy is
contested, the Trustees shall not be obligated to take any
action for collection unless and until they shall have been
indemnified to their satisfaction against any loss, liability or
expense, including attorneys' fees. Notwithstanding anything to
the contrary herein contained, the Trustees are authorized to
reimburse themselves, with respect to any liability, fees and
any other expenses incurred in connection with obtaining any
proceeds of any said policies, from the principal or income of
this trust, and the Trustees may charge the same as an expense
of that Trust.F. Upon payment to the Trustees of the amounts due under
said policies of insurance, the insurance company issuing such
policies shall be relieved from all liability hereunder and no
such company shall be under any responsibility to see to the
performance of the trust created hereby. G. With respect to any proceeds of any insurance payable to
the trust hereunder, the Trustees may, in their absolute
discretion, leave such proceeds, or any part thereof, with the
insurance company issuing the policy or policies from which such
proceeds are payable. Further, the Trustees may exercise any
option permitted by the terms of such policy or policies or
permitted by the issuing insurance company, thereby causing such
proceeds, or the interest thereon, to be payable by the
insurance company pursuant to the terms of such option or any
supplementary agreement with such company, to the Trustees, as
Trustees of this trust, or to any beneficiary hereof, in such
manner and amounts as the Trustees shall elect. ARTICLE VIII.
The Trustees shall not be required to make physical
division of the trust property, except when necessary for the
purposes of distribution, but may, in their discretion, keep the
trusts in one or more consolidated funds, and as to each
consolidated fund the division into the various shares
comprising such fund need be made only on the Trustees' books of
account, in which each trust shall be allotted its proportional
part of the principal and income of the fund and charged with
its proportionate part of expenses thereof. ARTICLE IX.
Notwithstanding anything herein contained to the contrary,
no powers enumerated herein or accorded to trustees generally
pursuant to law shall be construed to enable the Grantor, the
Grantor's estate, the Trustees, or any other person, to sell,
purchase, exchange, or otherwise deal with or dispose of all or
any part of the corpus or income of the trusts for less than an
adequate consideration in money or money's worth, or to borrow
all or any part of the principal or income of the trusts,
directly or indirectly, without adequate interest or security.
No person, other than the Trustees, acting in a fiduciary
capacity, shall have or exercise (a) the power to vote or direct
the voting of any shares or other securities of the trusts or to
control the investment of the trusts either by directing
investments or reinvestments or by vetoing proposed investments
or reinvestments; or (b) the power to reacquire or exchange any
property of the trusts by substituting other property of an
equivalent value.ARTICLE X.
Within the limitations set forth in Article IX above, and
to facilitate payment of administrative expenses, debts, estate,
inheritance or other death taxes by the Executor of the estate
of the Grantor, the Trustees may use all or any part of the
property of this trust to the extent the Trustees, in their sole
discretion, deem advisable to: A. Purchase from the Executor of the estate of the Grantor
or the estate of the Grantor's wife, any property, real,
personal or mixed, tangible or intangible and wherever situated
that may comprise a part of the estate of the Grantor or the
estate of the Grantor's wife; or B. Make loans to the Executor of the estate of the Grantor
or the Executor of the estate of Grantor's wife. ARTICLE XI.
The trust herein created is a private trust, and the
Trustees shall not be required to obtain the order of approval
of any Court for the exercise of any powers or discretion herein
given. The Trustees shall not be required to enter into any bond
as Trustees nor shall he be required to return to any Court any
periodic formal accounting of his administration of the said
trust, but said Trustees shall render annual accounts to the
beneficiary or beneficiaries of such trust. ARTICLE XII.
The Trustees may resign and cease to act at any time by
giving written notice specifying the effective date of such
resignation, by personal delivery or by registered mail, to
those persons who are beneficiaries of the trust at that
particular time. In the event of such resignation, or the death,
incapacity, or extended illness of six or more successive months
of any Trustee, the other Trustees may elect or appoint a
substitute Trustee to serve as successor Trustee. If the
remaining Trustees can not agree on such a successor, a
successor Trustees shall be appointed by the Grantor's wife if
she be living and if not by the Chancery Court of Hinds County,
Mississippi, upon petition by the beneficiaries. Any such
successor Trustees that may be appointed by the Trustees, the
Grantor's wife or the Chancery Court shall not be the Grantor or
his wife and must be a party independent of and free from
control by the Grantor. The resignation of a resigning or
removed Trustee shall become effective upon the qualification of
the successor Trustee. Any successor Trustees shall be vested
with all the rights, powers, duties and discretion herein
conferred on the original Trustees.ARTICLE XIII.
The interest of every beneficiary shall vest within the
period prescribed by the Rule against Perpetuities or any
statute pertaining thereto. Upon such vesting any trust property
then held by the Trustees shall be paid over forthwith, free and
clear of any trust, to the current income beneficiary or
beneficiaries of such trust property (or to his or her legal
guardian or other personal representative) as though each such
current income beneficiary had reached the age at which final
distribution to him or to her were required pursuant to the
provisions hereof. If at the time of the vesting of an interest
the beneficiary shall be a minor, the Trustees shall continue to
hold his or her trust estate in trust for his or her benefit,
distributing income and principal as the Trustees deem
advisable, until such beneficiary shall attain twenty-one (21)
years of age at which time the Trustees shall pay over to that
beneficiary his or her entire trust estate. ARTICLE XIV.
This trust is and shall be irrevocable and after the
execution of this Trust Agreement the Grantor shall have no
right, title, or interest in or power, privilege or incident of
ownership in regard to any of said property and/or money and
shall have no right to alter, amend, revoke or terminate this
trust or any provision hereof. ARTICLE XV.
The Trustees shall be entitled to receive reasonable
compensation for their services hereunder. If a Trustee is a
bank such compensation shall be determine in accordance with its
schedule of compensation established from time to time by the
Trustee's Trust Department for the administration of trusts of a
character similar to this trust. Such compensation may be
collected annually by the Trustees and shall be shown in their
annual accounting. ARTICLE XVI.
The Trustees shall not be liable for any loss to the trust
estate occasioned by their acts in good faith, and in any event
shall be liable only for their own wilful negligence or default,
and not for honest errors of judgment or for interest on
uninvested funds. The Trustees, in their discretion, may
purchase an errors and omissions insurance policy covering them
as Trustees, in such amount as the Trustees may in their sole
judgment deem advisable. Premium payments for such policy may be
made by the Trustees from trust funds and charged as an expenses
against the income of the trust. None of the provisions of this
Article XVI shall apply to any corporate Trustees.
ARTICLE XVII.
This Irrevocable Trust Agreement may be executed in any
number of copies, each of which shall be an original and no
other copy need to be produced. IN WITNESS WHEREOF, this Trust Agreement has been executed
by the parties thereto on the day and year first above written.
__________________________________
**, GRANTOR
__________________________________
__________________________,Trustee
__________________________________
__________________________,Trustee
STATE OF MISSISSIPPI
COUNTY OF ____________ PERSONALLY came and appeared before me, the undersigned
authority at law in and for the aforesaid jurisdiction, **, who
acknowledged that he executed the above and foregoing
Irrevocable Trust Agreement on the day and year therein shown. GIVEN UNDER MY HAND AND OFFICIAL SEAL, this the ____ day of
___________________, 199**. ______________________________
NOTARY PUBLIC
My Commission Expires: _______________________
STATE OF MISSISSIPPI
COUNTY OF _____________ PERSONALLY came and appeared before me, the undersigned
authority at law in and for the aforesaid jurisdiction,
**, who acknowledged that he executed the above and foregoing
Irrevocable Trust Agreement on the day and year therein shown. GIVEN UNDER MY HAND AND OFFICIAL SEAL, this the ____ day of
**, 199**.
_____________________________
NOTARY PUBLIC
My Commission Expires: _______________________
